Tokyo Steel to Post 90% Lower Recurring Profit for F2009

Tokyo Steel Manufacturing announced on Friday the firm posted 55.3 billion yen of recurring profit for fiscal 2008 ended March 2009, which increased to 3.2 times of the profit in fiscal 2007 due to the steel price increase. Averaged selling price of steel increased by 27,500 yen to 103,000 yen per tonne while averaged ferrous scrap cost increased by only 5,000 yen to 46,000 yen per tonne. Average cost of ferrous scrap for second half declined to about one third of the cost in the first half. The recurring profit margin rose by 12.9 percentage points to 19.9%. However, the firm estimates the recurring profit decreases to 4.5 billion yen for fiscal 2009, down by 91.8%.

The sales increased by 13.7% to record 278.4 billion yen for fiscal 2008 from fiscal 2008 while the net profit increased to 3.2 times at 32.2 billion yen. On the other hand, steel sales volume decreased by 16.7% to 2.697 million tonnes. The firm reduced crude steel output by 15% for October-December 2008 and by 55% for January-March compared with the peak in July-September. The export volume decreased by 64.3% to 0.275 million tonnes for fiscal 2008 from fiscal 2007.

The firm estimates 60,500 yen per tonne of the averaged steel selling price and 21,500 yen of ferrous scrap cost for fiscal 2009. The firm plans the steel shipment is 2.2 million tonnes, down by about 18% from fiscal 2008.